|Tennessee and Hankook Tire officials breaking ground on the new plant in Tennessee. [Image: Hankook Tire]|
Hankook Tire, the largest Korean-based tire manufacturer is preparing for its new plant in Clarksville, Tennessee, to begin running at full capacity. The $800 million 1.5 million-square-foot factory will produce 5.5 million tires per year for passenger vehicles and light trucks; comprising 28% of Tennessee’s tire production. Starting test operations early this year, Hankook has already hired 300 laborers and plans to employ 1,200 in total. Moreover, Hankook plans to expand capacity to 11 million tires annually, and increase total employment to 1,800 on its second phase of operation by 2018.
Hankook moved its North American headquarters to Nashville, Tennessee last year, bringing core sales and management departments — corporate communications, human resources, supply chain management team, and original equipment teams that work with vehicle manufacturers — to the state. The head office hosted a job fair in October last year to provide information about employment with the company. The relocation of the headquarters as well as the completion of the new factory have contributed to Tennessee becoming one of the largest automotive industry hubs in the US.
Tennessee has made strong alliances with foreign enterprises in the automotive industry. In fact, Tennessee benefits from more foreign direct investment (FDI) than any other state in the US. Tennessee was ranked the top state for job creation resulting from FDI in 2015. In particular, the automotive industry accounts for a disproportionately high portion of Tennessee foreign investment. Of the $33.3 billion of total FDI in Tennessee, $21.9 billion was invested in automotive operations.
Tennessee is a home for many Northeast Asian automotive companies, including well-known organizations such as Nissan, Bridgestone, Denso, Hankook Tire. Foreign investment by Japan, South Korea, and China accounts for 42% of Tennessee Employment from foreign investment. Moreover, these three countries are currently responsible for 58% of foreign investment in Tennessee. In regards to FDI in the automotive industry, Japan and South Korea rank first and third place, contributing $15.9 billion and $965 million respectively.
Jaichung Lee is a Research Intern at the East-West Center in Washington and an Asan Washington Young Fellow with the Asan Academy in Seoul.